Monday, January 28, 2008

Friday, specialty retail publications broke the news: Parent SuperValu is closing all five of its Sunflower Markets including the one in Indianapolis'Broad Ripple. Four other stores are located in Ohio and Illinois. The chain was designed to be a lower-priced, neighborhood alternative to more expensive organic/natural food markets such as Wild Oats and Whole Foods. Sunflower, on Broad Ripple Ave just east of the Monon Trail, will close the week of February 18.

SuperValu says they're closing the chain due to poor performance even though last year they announced plans to expand the concept nationwide. However, analysts say SuperValu has had stock problems all year after acquiring the Albertson's drugstore chain. Others speculate the Sunflower market concept, while unique, was too far away from the core business to continue sustaining lower-than-expected margins, let alone a costly expansion.

Rumors began flying late last year that the chain was in trouble when stores began scaling back inventory replacing deep selections in the natural food area with house brands. Competitor Wild Oats, on the other hand, expanded inventory and their pre-made food selection last year as a result of a corporate merger with Whole Foods. (Hat tip to reader Kevin who reminded me to check on this.)

22 comments:

Although I really liked Sunflower, I can see how it failed. The location is within a mile of another store. I live south, and there isn't ANYTHING remotely close...and Broad Ripple isn't easily accessed from the interstate.

Once the store brands took over and they started rearranging things, less than a year after they opened, there wasn't much appeal left--and the prices were never that competitive. They also never really had a selection or quality that one couldn't find elsewhere, save maybe for locally raised eggs, and the place, once spiffy, had already started looking pretty rough around the edges with all of the changes. I just hope that other companies don't assess Indianapolis as a poor place for this sort of natural foods market. Would a lame grocery store of house brands and wilted produce do well in Portland or Minneapolis? Makes one hope that more independent shopkeepers will take the risk--it's clearly working at The Goose (God bless us, one and all).

The closing has nothing to do with the market in Indianapolis or the Broad Ripple location. Supervalu is closing ALL Sunflower locations including the very well located location on Clybourn in Chicago. This is simply a change in strategy fo Supervalu. This was also noted in the Star article. Indy is a great market for natural foods!

Wha! Hate to think of the empty space. It was a good idea that never lived up to its claims: Prices? nothing special. Selection? I could never wrap my mind around most of their aisles. And the bakery? The category is overdone in BR, so that didn't help them. What I loved about them? Same stuff I love about Trader Joe's - the wine, the pre-made stuff...er, TJ's makes it worth the drive b/c of their prices!Shame on Supervalu for not delivering what they promised:(

The Star article was based on the same press release I saw over the weekend which specifically said the business unit wasn't meeting corporate expectations. Read: It wasn't making them money or enough money. While I've heard the Indianapolis store was doing fine, the changes that many note here (store brands, limited selection, cutting corners)were chain-wide and in line with SuperValu's busienss model. They make money by pushing out lower priced, lower quality store brands for a better margin and I suspect they were finding that the same business model didn't translate to the natural/organic food market as they'd hoped.

Most telling is that the five-store chain was shut down rather than sold but I'm not their business analyst. Their spin is "not in line with their core business" which translates to: their business model didn't work they way they'd hoped, it's not profitable, and not saleable, so they're closing the chaine down rather than invest a ton more money in a national expansion creating a business unit that's so far from their core philosophy that it won't allow them to create and share product lines and inventories across the board -- realizing better profitability and cost savings.

Big Box Retailers: Remember companies like SuperValu know they have been purveying "junk" to you for years. It is only in the advent of the information age that the "average" consumer begins to understand that healthy food is well...healthy! The consumer is no more fooled when a Billion Dollar behemoth like SuperValu jumps into the organic business. Would you really trust a retailer like Walmart being in the organic business? Of course not and anyone whom is partially informed looked right through the Sunflower Market concept. Not to mention the sterile warehouse appearance of their concrete floors.

You know, this news really pi**es me off. Sunflower never delivered what hey promised from the beginning. And now they have created a space in one of the most high traffic parts of town just to abandon it altogether. The space is going to become exactly like their produce, which is to say an eyesore. We could only hope that Good Earth could be ready for a move like that. Can you imagine, their products, their knowledge and that location? It would be a killer recipe!

Heres a hearty "cheers" to all the local groceries, new and old, who are changing the rules!

Sunflower was always dreadful. The meat section was a joke and their desserts looked like I made them several years ago. I'm sad that that means my closest supermarket is now Safeway (until Fresh Market opens in March. Hooray!), but I'm also glad that a bad concept badly executed isn't just barreling its way to success thanks to lack of options, like Marsh.

Trader Joe's isn't as quirky as one would think. They are just big business repackaged to look like they care. Most of their meat products are produced by Swift/Armour. The are basically just a marketing company. But hey after all marketing can sell milk to cows.

Big business or not, I like TJ's selection, some of the prices are quite low compared to other grocery-type stores around, and they carry some unique items that I can't find elsewhere. I'd rather that an independent grocery replaced Sunflower, but as a Broad Ripple resident, I'd rather have a not-quite-so-quirky TJ's over another bar, which isn't a retail offering that Broad Ripple is short of.

kc: Do you also like that Swift had to fire nearly a quarter of their workforce last year when they were raided by Immigration Officials? Buying from big box retailers gives them a mandate for business as usual. I think they snicker when they fool you into believing they as some small private company. I suppose those illegals were just doing some of those "jobs Americans don't want to do" (for a non-living wage.) For the non-business and non-law students...out sourcing is legal..."in-sourcing of illegal immigrants" is not legal no matter how noble the illegals pursuit of a better life may be.

Hey, "I'm illegal", I'm going to ask you to take the political commentary over to a political blog. Not only do you have inaccurate information re: Swift, and also re: the jobs illegal immigrants do with meat packing facilities, but you have severely underestimated the support that immigrant workers -- from farmers to line cooks -- have in the food world.

Not only do you not want to have this conversation on this blog, but trust me, you do not want me to host it.

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